Weave Communications (WEAV 13.10%), a provider of cloud-based communication and automation tools for healthcare practices, released its second-quarter results on July 31, 2025. The company reported GAAP revenue of $58.5 million in Q2 2025, above the analyst consensus of $57.81 million (GAAP) for Q2 2025, and non-GAAP earnings per share (EPS) of $0.02, ahead of the estimated $0.00. driven by growth in its specialty medical segment and milestones in artificial intelligence (AI) integration via its newly closed acquisition of TrueLark. Although top-line growth was strong, free cash flow (non-GAAP) increased to $3.4 million in the first six months of 2025. The quarter’s results underscore Weave’s ongoing momentum with a focus on execution as it balances growth and cost control.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| Revenue (GAAP) | $58.5 million | $57.81 million | $50.6 million | 15.6 % |
| Non-GAAP Gross Margin | 72.3 % | N/A | 71.9 % | 0.4 pp |
| Non-GAAP Income from Operations | $0.1 million | N/A | ($1.0 million) | N/A |
| Free Cash Flow | $4.5 million | N/A | $21.2 million | (78.9 %) |
Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q1 2025 earnings report.
Business Overview and Recent Focus Areas
Weave Communications delivers an all-in-one platform for healthcare providers, integrating phone, messaging, scheduling, and payments functionality. Its tools, built for small- and medium-sized practices in dental, optical, veterinary, and specialty medical fields, aim to streamline front office work and deepen patient engagement. The company’s technology helps replace fragmented systems with simplified, cloud-based tools that support operational efficiency and patient relationships.
Recently, Weave has focused on expanding its customer base within specialty healthcare segments and driving technology upgrades. AI-powered workflow automation, cloud integration, and new product tie-ins have been central to its value pitch. Success depends on scaling into more medical verticals, deepening customer relationships, and differentiating through ease of use and robust regulatory compliance.
Quarter Highlights: Revenue Growth, Expense Trends, and Product Milestones
Management attributed this expansion to ongoing momentum in specialty medical verticals and stronger cross-selling, with particular strength from new product integrations and mid-market account wins, while onboarding and phone hardware sales showed mixed trends.
Non-GAAP gross margin improved to 72.3% in Q2 2025. For the first time, Weave moved into positive non-GAAP operating income—an improvement from a $1.0 million non-GAAP loss from operations in Q2 2024. Adjusted EBITDA, a measure tracking earnings before interest, taxes, depreciation, and stock compensation, also swung to a small positive. However, GAAP metrics showed continuing net losses, with a $10.2 million operating loss including increased costs related to the TrueLark acquisition.
Weave closed its purchase of TrueLark during the quarter, a move that broadens its capabilities in agentic artificial intelligence-driven front office automation. TrueLark’s automated receptionist software engages patients 24/7, managing tasks like appointment booking and handling inquiries by text and web chat. The purchase added $29.3 million in goodwill and $7.8 million in intangible assets to the balance sheet as of June 30, 2025, reflecting the value assigned to the acquired platform and know-how.
Weave launched new connections with Ortho2 Edge for orthodontic offices and IDEXX Neo for veterinary clinics, strengthening its ecosystem and reach. Management promoted Abhi Sharma to Chief Technology Officer, underscoring the focus on accelerated technology adoption and AI enhancements drawn from leadership experience at large technology firms.
In customer growth, specialty medical emerged as the company’s second-largest vertical by location count, with record additions and increased presence in the mid-market; though penetration across all core verticals is still below 15% as of Q1 2025, suggesting room for continued expansion. A noteworthy development in payments was a rising attach rate, meaning more customers adopted Weave’s integrated payments solution; management noted in Q1 2025 that the attach rate remained below 10% of revenue but continued to increase, though payments revenue remains under 10% of total sales as of Q1 2025.
Customer satisfaction remained high, with Weave ranked first across 34 categories by G2, a major software review site. However, retention softened slightly. Gross revenue retention dropped to 90% in Q2 2025. Net revenue retention was 96% in Q2 2025.
Sales and marketing expense (GAAP) increased 15.3% year over year in Q2 2025. Stock-based compensation also increased.
Free cash flow—a measure of cash left after covering capital investments—rose to $3.4 million in the first six months of 2025.
Looking Ahead: Outlook and Key Watchpoints
For Q3 2025, Weave forecasts total revenue of $60.1 million to $61.1 million, setting a path for sequential growth. Non-GAAP operating income guidance is between flat and $1.0 million for Q3 2025, suggesting continued positive profitability, though not indicating a rapid margin expansion. For FY2025, management is targeting full-year revenue of $236.8 million to $239.8 million and non-GAAP operating income of $1.2 million to $3.2 million. These targets reflect incremental revenue from TrueLark and an assumption of continued account expansion, but modest bottom-line gains as integration and product investments remain priorities.
The integration of TrueLark will shape both top-line growth and short-term cost dynamics. No dividend is currently paid by WEAV.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
